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News Release

Warsaw

Polish office market set to grow by 900,000 sq m in 2016

There is approx. 1.5 million sq m of office space under development throughout Poland. Developer activity in Krakow at historic high – over 280,000 sq m of offices under construction


Advisory firm JLL summarizes the situation on the office markets in Warsaw and other major Polish cities[1] at the end of Q1 2016.

Anna Młyniec, Head of Office Agency and Tenant Representation at JLL, comments: "In Poland, office lease agreements for a total of 250,400 sq m were signed in Q1 2016. Major office markets outside Warsaw accounted for 108,200 sq m of this number. The highest take-up was recorded in Warsaw – 142,200 sq m, followed by Kraków with 39,400 sq m. We expect an increase in tenant activity in the upcoming months."

The biggest office lease agreements concluded in Q1 2016 in Poland

CompanyCityBuildingSpace (sq m)
Credit SuisseWrocławGrunwaldzki Center10,800
AonKrakówEnterprise Park E10,750
AllegroWarsawQ227,600
Confidential tenantWarsawAtrium 27,500
Rockwell AutomationKatowiceA4 Business Park III7,450
PrimulatorŁódźPrimulator HQ7,300
Shell KrakówDot Office5,850
Heineken Global Shared ServicesKrakówVinci Office Center5,700

Source: JLL, PORF, Q1 2016

"The modern business services sector remains a key office tenant on major Polish regional markets, accounting for approx. 63% of demand registered outside Warsaw in Q1 2016. In Wrocław, companies from the sector accounted for 83% of the city's quarterly office take-up, in Katowice – 81% and in Kraków - 74%", adds Anna Młyniec.

Supply

By the end of Q1 2016, total office stock in Poland reached approx. 8.3 million sq m. 218,000 sq m of new office space was delivered to market (113,000 sq m in Warsaw and 105,000 in other locations) in Q1 2016.

The biggest office completions in Q1

BuildingCitySpace (sq m)
Eurocentrum Office Complex DeltaWarsaw25,000
Astrum Business Park IWarsaw22,600
Tryton Business HouseGdańsk21,300
Atrium 2Warsaw20,250
Prime Corporate CenterWarsaw20,150
Gdański Business Center II CWarsaw19,700
O3 Business Campus IKraków19,200
C200Gdańsk17,000
Kaufland HQWrocław16,000
Storrady Park OfficesSzczecin7,400
Equal Business Park AKraków6,900
KróLEWskaWarsaw5,400
Tensor XGdynia5,000

Source: JLL, PORF, Q1 2016

"Currently, there is approx. 1.5 million sq m of office space under construction throughout Poland. The largest developer activity is in Warsaw, where 662,000 sq m is under construction, followed by Kraków - 284,000 sq m, Wrocław - 170,000 sq m and Łódź - 106,000 sq m. According to our preliminary forecasts, the Polish office market is likely to grow by 900,000 sq m in 2016", says Mateusz Polkowski, Associate Director, Research and Consulting, JLL.

Vacancy rate

Vacancy rate in Warsaw was 14.1% by the end of Q1 2016. Outside Warsaw, the lowest vacancy rate was registered in Kraków (5.7%) while the highest was recorded in Szczecin (18.3%).

Rents

Prime headline rents in Warsaw's city centre averaged out at between €21 and €23.5/ sq m / month. Outside the city centre, rents vary between €11 and €18 / sq m / month. As for major office markets outside Warsaw, the lowest rents are recorded in Lublin (€11 – €12 / sq / month) while the highest can be found in Poznań and Wrocław (€14 – €14.5 / sq m / month).

***

In Q1 2016, JLL's team of experts advised on office lease transactions totaling approx. 61,000 sq m throughout Poland. This gave JLL a 34% market share, the highest among real estate advisory firms.



 

[1] Major office markets outside Warsaw include Kraków, Wrocław, Tri-City, Poznań, Katowice, Łódź, Lublin and Szczecin